Problem B (pricing) Pick-Me-Up Company is introducing a new coffee in its stores and must decide what price to set for the coffee beans. An estimated demand schedule for the product follows:

Price	One-pound units demanded
$ 5	80,000
6	72,000
7	56,000
8	48,000
9	36,000
10	30,000

Estimated costs follow:

Variable manufacturing costs $2 per unit

Fixed manufacturing costs $40,000 per year

Variable selling and administrative costs $1 per unit

Fixed selling and administrative costs $20,000 per year

a. Prepare a schedule showing management the total revenue, total cost, and total profit or loss for each selling price.

b. Which price do you recommend to the management of Pick-Me-Up? Explain your answer.